Maintaining Compliance in Export Control: Essential Practices
An Export Compliance Program is a proactive strategy to methodically reduce the risk of regulatory violations. The essential steps include risk assessments, commodity classification, customized procedures, tailored training, and regular auditing. The system must be robust, with redundancies and cross training, so there is no single point of failure. The objective is not just to gain compliance but, rather, to maintain compliance. This is critical. Disruptions and transitions are inevitable so the compliance system must be active, engaged, resilient.
Anticipating Compliance Changes: Staying Ahead of Regulatory Shifts
While it is inevitable that transitions will occur, there are important distinctions in these changes and how we prepare for them. The obvious difference is that some turbulence will come from outside the organization, often unexpectedly and beyond our control, like sanctions and embargoes or changing regulations. In contrast with these external transitions are the internal changes that we usually see coming such as new products and markets, new policies and procedures, new employees and managers. What these transition types have in common is that the organization must adapt to ensure that essential functions, like export control compliance, remain continuously viable.
Overcoming External Transitions: Strategies for Resilient Compliance
To protect yourself from outside influences, a few preparations are necessary. First, you need ongoing awareness; you need to follow what is happening in the trade compliance world. Some things are more obvious, like embargoes that make front page news, but sanctions and denied party designations are often swift, selective, and scarcely publicized. Protect yourself with vigilant screening, preferably with known software providers, so you know immediately about adverse changes to the status of your stakeholders: countries, companies, clients, brokers, freight forwarders, investors—you can screen everyone every day.
Is it cautious? Yes. Is it prudent? Hell yes. How about new or changing regulations? You can sign up for newsletters, many of them free, join industry groups, like the Society of International Affairs (SIA), or attend national compliance conferences such as BIS Update and hear first-hand about new or looming changes in U.S. export control. Most of these solutions are easy and affordable, compared to the cost and hassle of a compliance violation.
Managing Internal Changes: Adapting to Maintain Compliance
Often these events are familiar and even deliberate but they can be challenging nonetheless. New products require export classifications and sometimes licensing also; new international clients, collaborations, and funding require screening and diligence to prevent possible technology transfers. The loss of key people should be anticipated and mitigated by redundancy, cross-training, and clearly written procedures. Any IT problems or upgrades should include caution to protect sensitive data, including controlled technologies. Regular audits or assessment should catch emerging vulnerabilities but it is preferable for the compliance team to anticipate these proactively and act early.
Final Takeaway: Sustaining Robust Export Compliance Practices
The objective is not just to gain compliance but, rather, to maintain compliance. Disruptions and transitions are inevitable so contingency plans should be made and adjusted as necessary. The system must be robust with no single point of failure. Compliance is active, engaged, resilient.
